The draft statements of financial position of Superior plc and its subsidiary company Pompous Ltd at...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The draft statements of financial position of Superior plc and its subsidiary company Pompous Ltd at 31 December 2020 are as follows: Superior Pompous £000 £000 £000 £00 Assets Non-current Assets: Land and buildings 315,000 278,000 Plant 285,000 220.000 600,000 498,000 Investment: Shares in Pompous at cost 660,000 Current Assets: Inventory 357,000 252,000 Receivables 525,000 126,000 Bank 158,000 30,000 1.040.000 408.000 2.300,000 906,000 Equity and liabilities Equity: £1 ordinary shares 1,500,000 600,000 Reserves 580.000 212,000 2,080,000 812,000 Current liabilities: Payables 220.000 94,000 Total equity and liabilities 2.300,000 906,000 The following information is also avallable. (a) Superior purchased 480 million shares in Pompous some years ago, when Pompous had a credit balance of £95 million in reserves. The fair value of the non-controlling interest at the date of acquisition was £165 million. (b) At the date of acquisition the freehold land of Pompous was valued at £70 million in: excess of its book value. The revaluation was not recorded in the accounts of Phoenix. (c) Pompous' inventory includes goods purchased from Superior at a price that includes a profit to Superior of £12 million. (d) At 31 December 2020 Pompous owes Superior £25 million for goods purchased during the year. Required i. Calculate the total goodwill on acquisition (5 marks) ii. Prepare the consolidated statement of financial position for Superior as at 31st December 2020. (15 marks) The draft statements of financial position of Superior plc and its subsidiary company Pompous Ltd at 31 December 2020 are as follows: Superior Pompous £000 £000 £000 £00 Assets Non-current Assets: Land and buildings 315,000 278,000 Plant 285,000 220.000 600,000 498,000 Investment: Shares in Pompous at cost 660,000 Current Assets: Inventory 357,000 252,000 Receivables 525,000 126,000 Bank 158,000 30,000 1.040.000 408.000 2.300,000 906,000 Equity and liabilities Equity: £1 ordinary shares 1,500,000 600,000 Reserves 580.000 212,000 2,080,000 812,000 Current liabilities: Payables 220.000 94,000 Total equity and liabilities 2.300,000 906,000 The following information is also avallable. (a) Superior purchased 480 million shares in Pompous some years ago, when Pompous had a credit balance of £95 million in reserves. The fair value of the non-controlling interest at the date of acquisition was £165 million. (b) At the date of acquisition the freehold land of Pompous was valued at £70 million in: excess of its book value. The revaluation was not recorded in the accounts of Phoenix. (c) Pompous' inventory includes goods purchased from Superior at a price that includes a profit to Superior of £12 million. (d) At 31 December 2020 Pompous owes Superior £25 million for goods purchased during the year. Required i. Calculate the total goodwill on acquisition (5 marks) ii. Prepare the consolidated statement of financial position for Superior as at 31st December 2020. (15 marks)
Expert Answer:
Answer rating: 100% (QA)
1Statement of identified Net Assests Date of aquisition Post arg... View the full answer
Related Book For
Financial Accounting A User Perspective
ISBN: 978-0470676608
6th Canadian Edition
Authors: Robert E Hoskin, Maureen R Fizzell, Donald C Cherry
Posted Date:
Students also viewed these accounting questions
-
Prepare a 2015 statement of financial position for Jarrow Corp. based on the following information: cash = $274,500; patents and copyrights = $860,000; accounts payable = $697,500; accounts...
-
The December 31, 2015, statement of financial position for the Blood Donors of America Foundation is presented below. Statement of Financial Position December 31, 2015 Assets Cash...
-
The income statement and unclassified statement of financial position for E-Perform, Inc. follow: Additional information: 1. Prepaid expenses and accrued liabilities relate to operating expenses. 2....
-
Here are the comparative income statements of Eudaley Corporation. Instructions (a) Prepare a horizontal analysis of the income statement data for Eudaley Corporation, using 2013 as a base. (Show the...
-
Paula Green owns and operates the Green Thumb Nursery as a sole proprietorship. The business has total assets with a $260,000 adjusted basis and a $500,000 FMV. Paula wants to expand into the...
-
Consider the following unbalanced equation: Ca 3 (PO 4 ) 2 (s) + H 2 SO 4 (aq) CaSO 4 (s) + H 3 PO 4 (aq) What masses of calcium sulfate and phosphoric acid can be produced from the reaction of 1.0...
-
Alternatives 1, 2, and 3 have lives of 3, 4, and 6 years, respectively. Their net cash flow (NCF) and salvage value (SV) profiles are as follows: Additional explanation is necessary: The NCF profile...
-
The following information pertains to Mason Company for 2016: Beginning inventory ...... 90 units @ $40 Units purchased ........310 units @ $45 Ending inventory consisted of 30 units. Mason sold 370...
-
3 3. 7 of the coins in a box are nickels. The rest are dimes. If there are 24 dimes, how many nickels are there?
-
J.D. Power and Associates surveys new automobile owners to learn about the quality of recently purchased vehicles. The following questions were asked in the J.D. Power Initial Quality Survey, May...
-
At the beginning of current year, Zamba Company announced the decision to close the factory located in Zamboanga and terminate all 150 employees as a result of economic downturn. The entity shall pay...
-
In North American business context Pregunta 2 Seleccione una: a. shaking hands is now widely regarded as an outdated custom. b. women are expected to shake hands differently than men. c. a firm...
-
Bill Gates, entrepreneur, opened a computer business and completed the following transactions in May. Show the effects of the transactions on the accounting equation below. Show that the accounting...
-
D Company reported the following information on its income statements for the first quarter: January February March Beginning Finished goods inventory $61,600 Cost of Goods Manufactured 229,000...
-
Our Introduction to Risk Management discussion in Week 1 is expanded to the understanding of chapter 3's Utility Theory. Utility Theory discusses the satisfaction level based on the individual's...
-
The IASB has argued companies are already required to reflect the impact of climate change on a company's operations through the application of existing accounting standards. St and S2 effectively...
-
3 BE14-1 Whiteside Corporation issues $500,000 of 9% bonds, due in 10 years, with interest payable semian- nually. At the time of issue, the market rate for such bonds is 10%. Compute the issue price...
-
Why can wastewater treatment requirements in Hawaii be less stringent than those in most locations on the U.S. mainland?
-
Northland Enterprises sells and services snowmobiles and other recreational vehicles, and has reported the following revenues and expenses for the year ended December 31, 2011: Sales of recreational...
-
Kim Moore owns a small auto repair shop, which has been in operation for a few years. The following statements attempt to summarize the shop's operations for the month of January and its financial...
-
As a potential lender, discuss how you might view the nature of a deferred income tax liability on a company's statement of financial position, and whether you would treat it in the same way as you...
-
Meet with the person you interviewed in mini case 1 and present them with the design prototype you created. Get their feedback on the design. Do they like it? Could they navigate the pages? What...
-
So far, we've researched the viewpoints of leaders in the field of information presentation and human interface design for computer systems. What about experts in other areas? a. Find and interview...
-
On the human factors and human engineering issues in user interface design. The spirt of the discussion is that it is imperative that we understand the people who will be using the system and that we...
Study smarter with the SolutionInn App